A major difference between skimming and cash larceny is that?

The distinction that skimming occurs without any entry into the accounting system, while larceny is associated with transactions and cash that have already been recorded, is crucial to understanding the mechanisms of these fraudulent activities.

Skimming refers to the theft of cash before it ever gets recorded in the company's accounting system. This means that the cash has never been counted in the company's revenues or assets – it's taken straight from the source, leaving no official record of the loss. This makes skimming more discreet in nature, as it is untraceable through regular accounting practices.

On the other hand, cash larceny takes place after the cash has been recorded in the accounting system. This could involve an employee stealing cash that has already been registered in the books, such as through manipulating records to cover up the theft or by creating fake transactions to siphon off funds.

Understanding this key difference helps in devising effective controls to mitigate these risks, as each type of fraud requires different preventive measures. It highlights the importance of monitoring cash flows and accounting entries to detect and prevent these sorts of thefts.